Developer sues Baltimore over Poppleton project

Drug addicts sit on the front steps of Anthony Williams' West Baltimore home and use.

The only homeowner left on his block of North Schroeder Street in the Poppleton neighborhood, Williams fears transients living in the vacant rowhouse next door will drop their cigarettes and send his place up in a blaze.

He is an island amid debris, he said, the victim of the city government buying up the surrounding properties — demolishing some and leaving others boarded up — as part of a 14-acre redevelopment plan that has cost the city millions and pushed people out of homes.

"I have been willing to relocate since I heard of the project … now that I am the last man standing I am absorbing all of the neighborhood's problems that have been left behind," Williams recently wrote to the head of the developer, La Cite Development LLC, contracted to rehabilitate the run-down community.

When the project was announced in 2006, the city and La Cite said new residences and retail space would start being built as early as the next year. Plans also called for a tennis facility and a new school. But the recession hit and now, six years into the development agreement with the La Cite-controlled company Poppleton Development I LLC, the city is trying to terminate the deal.

A federal judge may decide Friday, after a hearing set for the morning, whether La Cite still might have the right to redevelop the area, a decision that will affect how much longer residents of Poppleton, just west of Martin Luther King Boulevard and south of U.S. 40, have to put up with a ripped up and nearly empty district.

The hearing before U.S. District Judge Richard D. Bennett is on La Cite's request for a temporary restraining order against the city. If he doesn't rule in the company's favor, the project could be derailed for who knows how long.

Baltimore Housing, the city agency responsible for the project, declined to say — because of the litigation — whether the Poppleton redevelopment would continue with another developer if New York-based La Cite gets the ax.

In May, nearly eight years after the city requested development proposals for the site, the Baltimore Department of Housing and Community Development notified the company in a letter that it had defaulted on their 2006 agreement.

The agency's spokeswoman, Cheron Porter, said in a statement to The Baltimore Sun: "Since La Cite has been unable to secure financing to move the project forward, Baltimore Housing is terminating the development agreement which was signed in 2006."

In response, La Cite filed a civil suit two weeks ago against the mayor and City Council, the housing agency and Housing Commissioner Paul T. Grazianoto prevent the city from voiding the contract. In court documents, the developer blames the city for La Cite's failure to get financial commitments.

The city has failed to acquire clear title to all of the properties in the project's first phase — or demolish and clear them — by agreed-upon dates, the complaint stated. Baltimore Housing also failed to keep the area safe, which could scare off financers, La Cite's attorneys argued.

The city also has blocked La Cite's access to public financing, the complaint charged. For instance, La Cite said the city delayed discussing tax increment financing until after the elections last fall.

"On one hand, they undermine our ability to get financing, then on the other hand they say we can't get financing," said Charles S. Fax, a Bethesda-based attorney representing Poppleton Development.

In spite of these obstacles, La Cite has received letters of intent from several entities willing to provide funding for parts of the project, Fax said. Attached to the complaint are letters from Wells Fargo, BB&T Capital Markets and U.S. Bancorp, among others, expressing interest in financing the redevelopment.

City Solicitor George A. Nilson said the city has been diligent about acquiring the necessary properties in Poppleton, anticipating the city's transfer of the land to La Cite. The city has already spent about $10 million on neighborhood properties, he said.

Baltimore has not defaulted on its obligations under the agreement, Nilson said, calling La Cite's version of the development's history inaccurate.

Fax said he believes the city's reason for attempting to terminate the development agreement, that La Cite couldn't nail down financing, is a pretext.

"Municipal winds have now shifted, and Baltimore City has recently decided to renege on its commitments," Fax wrote in the complaint. Then-Mayor Martin O'Malley's administration executed the agreement, but now, two mayors later, interest in working with La Cite has vanished, Fax said.

The project, which La Cite calls Park Square, is a stone's throw from the University of Maryland BioPark, the Edgar Allan Poe house and Franklin Square Park.

The 2006 agreement gave La Cite's Poppleton Development the right to rehabilitate 13.8 acres, roughly bordered by West Mulberry Street to the north, North Amity Street to the east, West Fairmount Street to the south and North Carrollton Avenue to the west.

The area it agreed to revitalize is made up of 526 properties, a horseshoe of land surrounding a large block containing the Greater Model public pool and Francis M. Wood High School. In 2004, when proposals were requested for the site, the city had not started the process of acquiring — through condemnation or other means — more than 160 of those tracts.

La Cite's plans for Park Square included up to 1,800 residences and about 150,000 square feet of commercial space for tenants such as an urban grocer and other retailers. La Cite also wants to launch a charter school at Wood High, where Excel Academy currently operates, and a youth-oriented tennis training center.

Poppleton residents are frustrated by the slow pace of the planned revival.

"I don't know what it's going to take" to get the development going, said Michael Johnson, 28, who grew up in Poppleton and moved back about six months ago.

Johnson said he'd like to see stores, homes or a playground — just about anything — built in the empty, overgrown lots across the street from his unit in Poe Homes, public housing that abuts the site set aside for redevelopment. There isn't much for children to do in the area, Johnson said, and the community's sole playground is a lot behind his building.

"People need jobs, so stores would be good," he said.

Althea Frazier, a neighbor of Johnson's in Poe Homes, said residents have nowhere nearby to buy groceries.

"You either have to go all the way down to Washington Boulevard … or go to Rite Aid or something," Frazier said. She'd like to see new housing and a Family Dollar store come to the area.

Williams, who did not know about the city's plan to terminate the La Cite contract, said he's desperate to get out. But he said he doesn't have the money to move from the home he's lived in for more than a decade and where his mother lived for 30 years before that.

In January, he emailed La Cite's founder, Dan Bythewood, begging him to circumvent the city's acquisition process and buy his home directly. Poppleton Development's attorneys included Williams' letter as evidence of the arguments made in their complaint.

"Presently I am the only resident on the entire block," Williams wrote. "I am willing to sell my proper[ty] directly to you because the city is dragging their feet for an offer."

Toys "R" Us stores will be taking back used baby products — cribs, high chairs, car seats, strollers and more — starting this weekend in exchange for discounts on new items, an annual event that has helped remove more than a million potentially unsafe items from the marketplace.

Two of Baltimore's most prominent developers want to build an arena on piers in the Inner Harbor, a new idea that has revived perennial debate about how to replace the aging arena on the city's west side.

Readers submit photos and information on employees who have recently been promoted, hired or honored at area businesses. Select photos will be published in the Maryland Business section of Tuesday editions of The Baltimore Sun. Caption size is limited and only photos are accepted in this...

Advocates for programs spending state dollars on stem cell research or investment in technology companies were nervous about what Gov. Larry Hogan's budget would hold for them, given warnings of "strong medicine" to cure fiscal woes.